VILASRAO G. PATIL L/H OF LATE RAJESH PATIL,SATARA vs. INCOME-TAX OFFICER, WARD - 5, SATARA

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ITA 1189/PUN/2019Status: DisposedITAT Pune17 August 2020AY 2010-114 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that once the assessee offered the income for taxation, its subsequent utilization through bank deposits should not lead to a further addition. Making an addition at the time of earning and another at the time of spending is not permissible.

What were the facts?

The assessee made cash deposits in his bank account, and during assessment, offered Rs. 3,00,000 as 'Miscellaneous Receipt'. The Assessing Officer added this amount under Section 69A, considering it a separate transaction from the bank deposit.

What were the issues?

Whether a sum offered as 'Miscellaneous Receipt' and taxed can be subjected to a further addition when utilized by way of bank deposit.

Which sections of the Income-tax Act were involved?

Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE – VIRTUAL COURT

Before: SHRI R.S. SYAL & SHRI S.S. VISWANETHRA RAVI

For Respondent: Smt. Shabana Parveen

PER R.S.SYAL, VP :

This appeal by the assessee arises out of the order dated 26-06-2019 passed by the CIT(A)-4, Pune in relation to the assessment year 2010-11. 2. The only issue raised in the appeal is against the confirmation of addition of Rs.3,00,000 made u/s 69A of the Income-tax Act, 1961 (hereinafter referred to as „the Act‟).

3.

Succinctly, the facts of the case are that the assessee made certain deposits in his bank account, the details of which were not forthcoming. During the course of assessment proceedings, the 2 Vilasrao G Patil

assessee submitted date-wise explanations about the cash deposits. The Assessing Officer (AO) accepted all other transactions except a sum of Rs.3,00,000, for which no documentary evidence was available. This addition of Rs.3,00,000 made u/s 69A of the Act came to be affirmed in the first appeal.

4.

We have heard the ld. DR through virtual court and gone through the relevant material on record. There is no appearance from the side of the assessee. The case was initially fixed for hearing on 07-10-2019 and the assessee remained up-represented. The matter has been adjourned from time to time where the assessee chose not to be present in the proceedings before the Tribunal. Today, we are, therefore, taking up the appeal for disposal on merits ex-parte qua the assessee.

5.

It is seen from page 7 of the impugned order that the assessee offered a sum of Rs.3,00,000 as „Miscellaneous Receipt‟ in her revised computation of income. The authorities have made and confirmed the instant addition on the ground that this receipt of Rs.3,00,000 was different from the deposit of Rs.3,00,000 in the bank account. We are unable to appreciate the view point of the authorities below on the ground that once the assessee offered a 3 Vilasrao G Patil

sum of Rs.3,00,000 on receipt of the amount, there could have been no occasion of making another similar addition on spending/investing the said amount. If a person earns Rs.100 from undisclosed sources and thereafter offers it for taxation, its later utilization, and that too, through undisclosed transactions, would not invite any further addition. The AO cannot make one addition at the time of earning the undisclosed income and another similar addition at the time of spending the same. Here is a case in which the assessee offered Rs.3,00,000 as „Miscellaneous Receipt‟, which has been duly taxed also. The utilization of such amount of Rs.3,00,000 by the assessee by means of deposit in the bank account, cannot, in our opinion, call for any addition. We, therefore, order to delete the addition.

6.

In the result, the appeal is allowed. Order pronounced in the open Court on 18th August, 2020. (S.S. VISWANETHRA RAVI) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पपणे Pune; ददिधांक Dated : 18th August, 2020 GCVSR

4 Vilasrao G Patil

आदेश की प्रनिनिनप अग्रेनषि/Copy of the Order is forwarded to: अपऩिधर्थी / The Appellant; 1. 2. प्रत्यर्थी / The Respondent;

3.

The CIT(A)-4, Pune

4.

The Pr.CIT-3, Pune विभागीय प्रविविवि, आयकर अपीलीय अविकरण, पुणे

5.

DR „SMC‟, ITAT, Pune; 6. गार्ड फाईल / Guard file. आदेशधिपसधर/ BY ORDER, //// Senior Private Secretary आयकर अपीलीय अविकरण ,पुणे / ITAT, Pune

Date

1.

Draft dictated on 18-08-2020 Sr.PS

2.

Draft placed before author 18-08-2020 Sr.PS

3.

Draft proposed & placed JM before the second member

4.

Draft discussed/approved JM by Second Member.

5.

Approved Draft comes to Sr.PS the Sr.PS/PS

6.

Kept for pronouncement on Sr.PS

7.

Date of uploading order Sr.PS

8.

File sent to the Bench Clerk Sr.PS

9.

Date on which file goes to the Head Clerk

10.

Date on which file goes to the A.R.

11.

Date of dispatch of Order. *

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